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Whoop, which makes a fitness tracker popular with professional athletes, reached a valuation of $ 3.6 billion following an investment from Japanese firm SoftBank, signaling investors’ willingness to challenge tech giants in the field of health surveillance.
SoftBank’s second Vision fund led a $ 200 million investment in Whoop, making it the most valuable stand-alone fitness monitoring startup, the company said. The new funding tripled Whoop’s valuation from previous funding in October.
Whoop chief executive Will Ahmed said the new capital would help the company compete with Amazon, Apple and Google, which each sell wearable health trackers.
“We are competing with trillion dollar companies,” Ahmed said. “Being well capitalized as a start-up when you go up against the biggest companies in the world tends to be a good strategy. “
Whoop’s fundraising is the most recent sign investors are turning to wearable tech despite a string of recent high-profile failures, as SoftBank and other deep-pocketed funders flood start-ups technology with record capital.
Oura, which makes a ring that measures a user’s sleep quality, raised $ 100 million in May from investors, including Singaporean Temasek, valuing the company at $ 800 million. The second Vision Fund also led a $ 100 million round of investment last year in Biofourmis, a healthcare company that uses a wrist sensor to monitor physiological data and predict medical problems.
Tech giants have deepened digital health in recent years. Apple CEO Tim Cook has said he wants the company’s biggest legacy to be in health and wellness, thanks to products like the Apple Watch.
In January, Google struck a $ 2.1 billion deal to buy fitness tracking company Fitbit, following extensive regulatory reviews in which rivals raised concerns about competition and processing of health data. Ahmed said Whoop does not sell customer data to third parties.
Whoop sells a subscription health coaching app that uses data from a bracelet to recommend changes to a user’s sleep and exercise habits.
Ahmed said Whoop has developed “proprietary algorithms” to measure blood pressure and recovery, measurements that take into account data such as heart rate variability.
Amazon recently moved into Whoop’s territory, selling a screenless fitness tracker called Halo with a subscription app.
Ahmed said Whoop has retained an increasing percentage of users over time since switching to a subscription-based business model in 2018. He declined to comment on the size of the company’s customer base.
“Sometimes when you reach out to a larger audience you may feel more unsubscribe,” Ahmed said. “For Whoop, it’s actually the opposite.”
Ahmed, a former Harvard University squash team captain, founded Whoop in 2012 with two fellow students after being frustrated by his lack of visibility into his own physical form.
Basketball player LeBron James and swimmer Michael Phelps became the first two users of the product. Whoop has also signed deals to supply bracelets to professional golf and American football leagues, and his list of investors includes golfer Rory McIlroy and basketball player Kevin Durant’s Thirty Five Ventures.
Ahmed said Whoop has yet to spend most of the $ 100 million in capital raised in his last funding led by Institutional Venture Partners, which also invested in the latest round of funding.
Previous attempts at wearables had been, “to put it politely, disappointing,” he said. “I think people underestimate the power of this technology. “
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